One transaction, and nothing to average it against.
A fund averages its mistakes across a portfolio. A searcher has one company. For a single transaction, we run the evidence on a target before a letter is priced.
Discuss acquisition criteriais the aggregate search fund return one university publishes. Another puts the weighted average at 2.50 times. Each is right about what it measured.
Stanford Graduate School of Business, 2026 Search Fund Study, data to December 31, 2025: more than 850 funds in the United States and Canada. Yale School of Management, How are Search Fund Investors Really Faring?, October 27, 2025: 1,192 observations from 12 investors in 23 funds. Yale does not say the Stanford figure is wrong; it argues that it is a population index no single investor can replicate. Both are shown; neither is preferred here.
The returns are disputed. The earnings question is no longer optional.
On an SBA-financed purchase above the threshold, the lender now commissions its own quality of earnings. It will read the same records you can read first.
SBA Information Notice 5000-880695, Issuance of SOP 50 10 8.1, effective October 1, 2026; the procedure binds SBA lenders and does not apply directly to a privately financed transaction. Yale School of Management, October 27, 2025. Stanford Graduate School of Business, 2026 Search Fund Study. A lower-middle-market deal platform’s published study of seventy-five broken letters of intent, January 27, 2026; exclusivity figures are averages by buyer type.
Six things the desk does before a name reaches you.
One company, and nothing to average it against. The desk puts the evidence on the record before the letter is priced.
The companies in it, the buyers active in it, and where its deals break, so one transaction is chosen from the whole sector rather than from what arrived.
One company, and nothing to average it against. Revenue reconciled to bank deposits and every adjustment marked, before exclusivity, not during it.
Relationships built before a banker is hired, so a sponsor with a specific thesis is already known when the owner decides.
The evidence a sponsor raises equity on, assembled before the raise, so the capital arrives with the letter rather than after it.
Independent sponsors held broken letters 129 days on average in the published study, longer than private equity buyers. The desk shortens the part of that time spent finding out.
Each business scored and ranked against criteria and weights you approved. You decide which to pursue.
What is on the record before you price it.
| Question | How it is usually answered | How the desk answers it |
|---|---|---|
| What does the business earn? | Adjusted earnings, as presented. | Every adjustment marked supported or unsupported, with the document that decides it. |
| Does the retention hold? | A figure from the CRM. | Gross and net retention by cohort, rebuilt from invoices and bank deposits. |
| Can it run without the owner? | A conversation at the management meeting. | Who decides, who sells, who delivers, from the records and the procedures, before the meeting. |
| Will the lender accept the earnings? | The lender’s own report, after the letter. | The earnings traced to source before the letter, so the lender’s report finds what you already knew. |
| What transfers? | Counsel’s review, in week six. | Every contract, license and permit with a consent requirement, listed before the letter. |
| What ended the last deal in this sector? | Nobody asks. | The Dead Deal Notes, coded by sector, stage and finding. |
Each engagement starts with your criteria and a clearly defined sector.
Your acquisition criteria and one clearly defined sector. The work covers one sector at a time, with scope agreed in writing before it begins.
The software businesses in that sector, scored and ranked against criteria and weights you approved. You decide which to pursue.
Built ahead of a process. Nothing about a company reaches you without its owner’s permission.
Each opportunity assessed before a letter of intent, so you are pricing against the findings instead of renegotiating after them.
Plain answers, then a conversation if you want one.
Why does one transaction change the evidence standard?
A fund averages its mistakes across a portfolio. A sponsor has one company. The findings that a fund absorbs are the findings that end a sponsor’s deal, so they have to be on the record before the letter is priced.
What does criteria on file ask of me?
Your criteria, confirmed with you each quarter. A retained search covers one sector at a time, with scope agreed in writing.
Can the desk help with the financing?
Through acquisition financing, Capital Row introduces financing needs it has already read to financing providers. The provider handles its application, underwriting and credit decision. The SBA acquisition loan rules are on the Insights page.
Do you represent the seller as well?
Never on the same transaction. Capital Row acts for one side, under a scope agreed in writing.
What is the first conversation?
What you are looking at, and where you are in the process. Read by a person.
The evidence on one target, before the letter is priced.
This is non-attest preparation.
Revenue reconciled to bank deposits, and reported earnings tied to the records behind them.
Each add-back in the seller’s presentation marked supported or unsupported, with the document that decides it.
Concentration, retention and contract terms, including what transfers on a change of ownership.
What was found and what it affects, before you price the letter. Scope is agreed in writing before any work begins.
Put your criteria on file.
See the rest of your market.
Capital Row helps buyers see more of their own market, with the financials traced to source before the letter of intent.
Read by a person.